The articles that are appearing almost daily about central banking are incredibly inept and reflect poorly on the financial news media. The central fact that is missing from every single one of these articles is that the commercial banking system, both in the US and in Europe, is awash in excess cash reserves and could easily provide incredible amounts of additional commercial lending, if the demand was there and the regulatory authorities would relax.
Instead the articles are all about how easy money is going away. Really? Prior to the current regime, easy money was always and forever defined as a condition of massive excess cash reserves in the commercial banking system. That condition is not going away -- not in the US and not in Europe.
Increasing the one day interest rate in the banking system is a stupid policy and has, so for had no effect for good or evil, as elementary logic would suggest. That doesn't keep Draghi and Yellen from spouting nonsense.
What keeps commercial lending down is deliberate government policy. US policy, encased in cement in Dodd-Frank, is that banks are now agents of the US government and are no longer intended to play their traditional role as financial intermediaries. The result of that absurd policy is the the moribund economic performance of the past eight years.
It's time the financial press got some new voices, who get beneath the PR utterances of political hacks like Draghi and Yellen, and tell the public the facts about monetary policy, instead of these air-brushed ignorant (of the facts) stories that are incredibly misleading.
Monetary policy remains absurdly loose and that fact will not change until excess reserves are drained from the system, both in the US and in Europe. But, easy money won't matter as long as bureaucrats are hell-bent on prohibiting economic growth and the expansion of commercial bank lending.